Vodafone leads Footsie comeback

Mobile phone giant Vodafone charged to its highest close for nearly six months today after half-year results beat expectations.

The shares soared 13% and a number of other telecom stocks also moved ahead as hopes grew that some of the gloom surrounding the sector could at last be lifting.

The gains also supported the wider market and, along with a strong start in the US, meant the FTSE 100 Index was able to close up 69.4 points at 4085.0.

Both the Dow Jones Industrial Average and tech-laden Nasdaq were trading higher by London’s close, despite increased fears about a possible war in Iraq.

But the main news of the day was Vodafone, one of the City’s biggest stocks.

It posted a 41% jump in underlying profits, to £4.25 billion, and chief executive Sir Christopher Gent said the group had proved the doubters wrong after cashing in on higher phone usage and increased text messaging.

The shares, hit by the tough conditions on the London market recently, climbed 12.5p to 111p. The last time the stock closed higher was at the end of May.

Other telecom firms following its lead included rival mmO2, which gained 3.25p at 54p, and BT, which added 6.75p at 201.75p.

Cable & Wireless, which is due to publish interim results tomorrow, rose 3.25p at 130.25p despite concerns the figures may include high restructuring charges.

Other heavyweights adding support included drugs giant AstraZeneca, ahead 60p at 2495p, and oil group Shell, 3.25p stronger at 406.25p.

Retailers were also pushing ahead, with B&Q-to-Comet group Kingfisher up 9.25p at 228.75p, health and beauty chain Boots 21p stronger to 591p and Argos-owner GUS ahead 20.5p at 665.5p.

In a busy session for corporate news, industrial gases group BOC moved up the risers board after full-year figures came in on target.

The stock gained 43p at 861p, a 5% hike.

And magazine publisher Emap added 22.5p at 775p after it revealed underlying pre-tax profits had risen 23% to £86 million, helped by the strong performance of UK titles such as gossip magazine heat.

But insurers continued to ease after suffering yesterday on reports credit agency Moody’s was considering downgrading the sector.

Prudential shed 8p at 440p, Legal & General lost 3.5p at 108p and Aviva eased 7p at 500p.

Among smaller stocks, Northern Foods rose after interim results met forecasts and the group remained confident for the coming months.

The festive season is a crucial period for the convenience food specialist and shares rose 1.75p to 155.5p.

And water and services group South Staffordshire added a penny at 466p after it showed how moves to bolster its services division had lifted half-year sales and profits.

The biggest blue-chip risers were Vodafone, up 12.5p at 111p, Invensys, up 4p at 62.5p, mmO2, up 3.25p at 54p and Bunzl, up 27p at 465p.

The heaviest fallers were Alliance UniChem, down 16.5p at 461.5p, Rentokil Initial, down 7p at 203p, Legal & General, down 3.5p at 108p and Rolls-Royce, down 2.75p at 111p.